Suppose that the MPC is 0.60; there is no investment accelerator; and there are no crowding-out effects. If government expenditures increase by $25 billion, then aggregate demand shifts rightward by $62.5 billion. shifts rightward by $50.0 billion. shifts rightward by $32.5 billion. None of the above is correct.

Suppose that the MPC is 0.60; there is no investment accelerator; and there are no crowding-out effects. If government expenditures increase by $25 billion, then aggregate demand shifts rightward by $62.5 billion. shifts rightward by $50.0 billion. shifts rightward by $32.5 billion. None of the above is correct.

Economics For Today

10th Edition

ISBN:9781337613040

Author:Tucker

Publisher:Tucker

Chapter21: Fiscal Policy

Section: Chapter Questions

Problem 20SQ

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Suppose that the MPC is 0.60; there is no investment accelerator; and there are no crowding-out effects. If government expenditures increase by $25 billion, then aggregate demand Answer shifts rightward by $62.5 billion. shifts rightward by $50.0 billion. shifts rightward by $32.5 billion. None of the above is correct.
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